Schlotterbeck's diagnosis: a company with “great ideas that can't execute” along with a continuing clash of cultures from the Imed and Ivac sides of the operation. He set about to fix the culture.

“Once we realized that we needed to change the culture, we also realized that no one knew how,” Schlotterbeck said. “So we all became voracious readers on how to do this.”

He became a big proponent of the book “Journey to the Emerald City,” which presents a system for changing an organization's belief system. He said he saw an effect on the company's financial results in six months.

“It was quite uncomfortable, because a lot of people had to change,” Schlotterbeck said. “But I was amazed at how quickly it started to take effect.”

In 2004, Cardinal paid $22 a share — $2 billion overall — for a company that had been worth 31 cents a share four years before.

The company continues to face challenges, including competition from big players such as Baxter, a $12 billion health care giant. Results at CareFusion have sagged recently as hospitals cut spending in the recession.

When CareFusion provided financial guidance along with Cardinal's quarterly earnings announcement last week, its 2010 earnings projection of $1.10 to $1.20 a share was slightly lower than some analysts expected.

Still, analyst John Kreger of Chicago investment bank William Blair & Co. said he expects CareFusion to perform better on its own than it would have under Cardinal.

In particular, he pointed to the potential for better management focus than would be possible in a massive company like Cardinal, as well as the potential to increase investment in research and development.

“There's really not a lot of evidence that Cardinal added a lot of value to any of these assets,” Kreger said. “They did a good job identifying best-of-breed companies, but they didn't really do a lot else.”

Schlotterbeck said the biggest risk at this point is getting complacent with a management team that's been together for several years. He also said the company needs to keep attacking new business, estimating the global market for the kinds of products CareFusion sells at $15 billion.

“Every hospital in the world has heard something about us,” Schlotterbeck said. “Not every hospital buys everything from us. That's the bad news, and the good news.”